Corporate tax instalment calculator
Reviewed by EverStone CPA · July 2026
Quick answer: Instalments catch profitable second-year corporations by surprise. Enter your tax owing to see whether they apply to you.
Estimates for general information — not tax advice specific to your situation. Rates and rules change and your result depends on details a calculator cannot capture. We confirm the numbers for your circumstances in a free consult.
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Does my corporation have to pay tax instalments, and roughly how much per period?
Corporations past their first profitable year — the year the requirement usually appears without warning. It uses the prior-year method. The CRA allows three methods and you may use whichever is lowest, provided your estimate holds up.
A worked example
These are the numbers already in the calculator above, so you can follow the arithmetic against the result it is showing.
| Step | Figure |
|---|---|
| Net federal tax | $12,000 |
| Threshold | Instalments generally required above $3,000 |
| Frequency | Quarterly, for an eligible small CCPC |
| Each instalment | $12,000 ÷ 4 = $3,000 per quarter |
| If not eligible for quarterly | Twelve monthly instalments of $1,000 instead |
What it assumes, and where it stops
Every estimate rests on assumptions. These are the ones that would change your number most.
| Assumption | What it means for your number |
|---|---|
| The prior-year method | Last year’s tax spread evenly. The current-year and two-year blended methods can be lower — but under-estimating creates instalment interest. |
| The threshold looks back two years | Instalments are required if net tax exceeded $3,000 this year OR in either of the two preceding years. One strong year can trigger them for the next. |
| First-year corporations are exempt | Which is exactly why year two surprises people: the first instalments can fall due in the same months you are paying year one’s balance. |
| Instalment interest is not deductible | Unlike most interest a business pays, this is a pure cost. |
General information, not advice. Have a CPA confirm it for your situation
The year-two surprise
A corporation pays no instalments in its first tax year. If year one is profitable, the CRA then expects instalments through year two — while you are also paying year one's balance. Owners who did not budget for the overlap feel it as a cash-flow shock rather than a tax increase, because that is what it is: the same tax, paid earlier.
Three ways to calculate — pick the lowest
The CRA permits the prior-year method (last year's tax, spread evenly), the current-year method (your own estimate of this year), and a two-year blended method. You may use whichever gives the smallest payments — but if you estimate low and are wrong, instalment interest applies to the shortfall, and it is not deductible. The current-year method suits a business you know is shrinking; the prior-year method is the safe default.
If you have already missed some
Instalment interest is charged, but it can be offset by paying later instalments early — the CRA applies a contra-interest calculation. Catching up promptly genuinely reduces the cost. The full instalment guide or see the check when your corporate return is due for your filing and balance dates.
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Corporate Tax Instalment Calculator FAQ
When does a corporation have to pay tax instalments?+
Monthly or quarterly?+
What if I pay too little?+
Do provincial instalments work the same way?+
How should I read the instalment amount this calculator gives me?+
What does this calculator not account for?+
When should I have my instalment plan reviewed?+
If the instalments above are more than your cash flow can cover, a CRA payment arrangement is usually a better outcome than missing them — the guide sets out how arrears interest works and how an arrangement is negotiated.
Want these numbers confirmed for your business?
A free consult with a Fraser Valley CPA — we will check the figures against your actual situation and quote a fixed fee.
Instalments sit alongside your filing and balance-due dates — see how the corporate deadlines fit together.